Best Credit Cards for Bad Credit Compared

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Last Update: September 17th, 2016

Compare Loan Alternatives (Credit Cards for Bad Credit)

About:

Across the top menu bar you’ll spot the main comparison listings dedicated to loan providers across various niches. Most of which are focussed on subprime lending with the exception of “Bank Loans” and a portion of the entries in “Car Finance“. The future objective is to continually improve every comparison page, but at the same time we’ll be looking to expand with loan alternatives. The first of which that will be looked at today is UK credit cards for bad credit. This is a very competitive and popular sector, although there are only a few direct issuers. Most of the solutions are alternative trading brands of Vanquis or affinity branded cards by them or Capital One.

Dominance:

The 2 major subprime lenders are Capital One (Capital One Financial Corporation) and Vanquis Bank (Provident Financial Plc). The latter is known for their Doorstep Loan Business. There are also 2 major prime lenders that extend to subprime with just a single product. This includes Barclaycard’s Initial (Barclays Plc) and Tesco Bank’s Foundation (Tesco Plc). Capital’s worldwide user base is 46m. Here in the UK they have accepted 4m customers, but their active user base is closer to 3m. Provident has 2.4m of which Vanquis represents 1.4m active customers (they have accepted 3m). Barclays has 48m worldwide. The Barclaycard division has 36m globally with 10.5m here in the UK. Tesco serves millions of customers each week through retail. Their banking division has 7.6m customers. This covers all of their banking products. Barclays/Tesco are giants of prime lending, but credit building is less of a priority.

Eligibility:

Target audiences are people unlikely to get accepted by their bank with low profile scores. At the same time, anyone who hasn’t borrowed before is considered as high risk. Vanquis generally comes across as the most lenient. They consider CCJs, defaults and past bankruptcy. Low income, self-employment etc could also be accepted. Capital One have a similar approach towards CCJs and defaults. They make it clear that past borrowing activity and being electoral roll listed are essential. NewDay’s Aqua/Marbles don’t accept people who have had a CCJ in the past year or previous bankrupts of 18 months. Barclaycard accepts a single CCJ, but no missed recent payments and no bankruptcy in 6 years. Tesco are quite vague just stating you are more likely to be accepted with no CCJ in the past 18 months and no account closures in the past year.

Market Size:

There are just 5 direct issuers, although Provident uses various trading names. Factoring these trading names, affinity partners etc the total current brand count rounds off nicely at 20.

We Have Compared:
APR: Card’s variable APR (minimum and maximum interest rate on purchases)
Credit Limit (CL): Credit limit. How much can be borrowed (New = N and Return = R)
Opening Times (OT): Business days/hours. At times this is broken up between “app = application queries” and “gen = general queries”
Waiting Time (WT): The approx waiting time between approval and receiving your new card

Notes:
– Abbreviations used: ND = Not disclosed. STS = Subject to status.
– Listings are sorted alphabetically into 2 groupings. This begins with the main lenders and we then move on to affinity/broker brands.
– If there is a specific product name then this will be listed next to their company name and their launch year. Some companies offer more than a single product. This was seen with Aqua (4) and Aquis (2).
– Just for reference, if you click through a company listing, these are not posted in the usual profile form, but more as general informational postings.

Best Credit Cards for Bad Credit Compared:

= Lenders…

Aqua Advance, Reward, Classic and Start (2002)
Aqua Credit Cards
APR:
1) 34.91% to 49.91% | 19.91% to 34.91% (future)
2) 34.91% to 49.91% | + 0.5% cashback per year (£100 cap)
3) 35.94% to 49.91%
4) 49.94% to 69.95%
CL: £250 to £1200 (N) and STS (R) | £100 to £300 (N) and STS (R)
OT: Mon/Fri (8am/9pm), Sat (9am/5pm), Sun (10am/6pm)
WT: 14 days
* £100/£300 is applicable to #4. #1 shows 15% reduction after 3 years

Aquis (ND)
Aquis Credit Cards
APR:
1) 29.84% to 59.94%
2) 49.94% to 59.94%
CL: £250 to £1000 (N) and £4000 (R) | £150 to £250 (N and R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* From VanquisBank. £150/£250 is applicable to #2

Barclaycard Initial (1966)
Barclaycard Credit Cards (Initial)
APR:
0% for the opening 3 months
Followed by 34.90% to ND | 29.90% to ND (future)
CL: £150 to £1200 (N and R)
OT: Mon/Sun (8am/11pm) (app) | Mon/Sun (24/7) (gen)
WT: 5 working days
* 5% reduction shown after 2 years. Free access to your Experian score

Capital One Classic (1996) (USA/1988)
Capital One Credit Cards
APR:
34.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
WT: 7 to 10 working days
* Issues for Littlewoods, Luma, Ocean, ThinkMoney and Very

Chrome (2016)
Chrome Credit Cards
APR:
29.50% to 39.94%
CL: £250 to £1000 (N) and £4000 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* From VanquisBank

Marbles (1999)
Marbles Credit Cards
APR:
33.83% to 44.94%
CL: £250 to £1200 (N) and STS (R)
OT: Mon/Fri (8am/9pm), Sat (9am/5pm), Sun (10am/6pm)
WT: 14 days
* Relaunched in 2015. NewDay acquired from HSBC

NEO (2014)
NEO Credit Cards
APR:
39.94% to 69.94%
CL: £150 to £1000 (N) and £3500 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* From VanquisBank

Origin (2014)
Origin Credit Cards
APR:
59.94% to 69.94%
CL: £150 to £1000 (N) and £3500 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* From VanquisBank

Original (2014)
Original Credit Cards
APR:
39.94% to 69.94%
CL: £150 to £1000 (N) and £3500 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* From VanquisBank

Tesco Bank Foundation (1997)
Tesco Credit Cards (Foundation)
APR:
0% for the opening month
Followed by 27.54% to 39.94%
CL: £250 to STS (N and R)
OT: Mon/Sun (24/7)
WT: 14 days
* Foundation itself was launched in 2014

Vanquis Bank (2003)
Vanquis Credit Cards
APR:
39.94% to 69.94%
CL: £150 to £1000 (N) and £4000 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* Issues for Argos, Black Diamond, Granite

= Partner (Affinity/Broker)…

Argos (2012)
Argos Credit Cards
APR:
29.95% to 49.94% | 39.94% to 49.94%
CL: £150 to £1000 (N) and £3500 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* Issued by VanquisBank. The varied rates depend on where you apply

Black Diamond (ND)
Black Diamond Credit Cards
APR:
39.94% to 69.94%
CL: £150 to £1000 (N) and £3500 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* Issued by VanquisBank. Brokered by Credit Benefit Services

Granite (2011)
Granite Credit Cards
APR:
34.95% to 59.94%
CL: £150 to £1000 (N) and £4000 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* Issued by VanquisBank. Related: Luma

Littlewoods (ND)
Littlewoods Credit Cards
APR:
34.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
WT: 7 to 10 working days
* Issued by CapitalOne. £10 bonus included. Related: Very

Luma (2012)
Luma Credit Cards
APR:
35.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
WT: 7 to 10 working days
* Issued by CapitalOne. Related: Granite

Ocean Finance (ND)
Ocean Finance Credit Cards
APR:
34.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
WT: 7 to 10 working days
* Issued by CapitalOne. Related: ThinkMoney

ThinkMoney (2016)
ThinkMoney Credit Cards
APR:
35.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
PN: MasterCard
WT: 7 to 10 working days
* Issued by CapitalOne. Related: Ocean

XYLO (2016)
XYLO Credit Cards
APR:
39.94% to 69.94%
CL: £150 to £1000 (N) and £4000 (R)
OT: Mon/Fri (8am/8pm), Sat (9am/5.30pm)
WT: 10 to 14 days
* Issued by VanquisBank. Brokered by Credit Benefit Services

Very (ND)
Very Credit Cards
APR:
34.94% to ND
CL: £200 to £1500 (N and R)
OT: Mon/Fri (9am/5pm) (app) | Mon/Sun (24/7) (gen)
WT: 7 to 10 working days
* Issued by CapitalOne. Related: Littlewoods

Comparison Insights:

Cheapest Credit Cards for Bad Credit (APR):
1) Tesco Foundation: 27.54% to 39.94%
2) Chrome: 29.50% to 39.94%
3) Aquis: 29.84% to 59.94%
4) Argos: 29.95% to 49.94%
5) Marbles: 33.83% to 44.94%

Notes: Variable range displayed. The deal from Argos must be sourced through a specific URL. Vanquis impressively commands 3 of those top 5 spots.

Best Short Term Deal…
Barclaycard Initial: 0% for 3 months on purchases

Best Long Term Deal…
Aqua Advance: 19.91% to 34.91%

Cheapest Partner Cards (Affinity)
1) Argos (Vanquis): 29.95%
2) Littlewoods (CapitalOne): 34.94% with £10 bonus

Experience: Barclaycard

The Barclaycard was the UK’s very first credit card launched in 1966. Capital One was established in their home country in 1988 and they moved to the UK in 1996. Tesco launched their first card in 1997. It isn’t clear when Barclaycard’s Initial product was released. Tesco’s Foundation arrived in 2014. Capital’s Classic would likely be the first subprime focussed offering. Marbles was launched in 1999, but this was as a near-prime product. NewDay acquired this business from HSBC. The very first affinity release was Granite in 2011. In the next year followed Argos and Luma.

Highest Approval Rates: Vanquis

This was touched over in the eligibility section above. Vanquis doesn’t put any blocks on bankruptcy, CCJs etc and they are fine with low incomes, self-employment etc. It may be a good idea to initially get started with Capital One QuickCheck. They guarantee a yes or no with no impact on your credit rating.

Limits (New Customers): Barclaycard and Aqua/Marbles

These lenders have shared upper caps of £1200 for first time applicants. Barclaycard’s Initial starts from £150, whilst the NewDay options start at £250 with the exception of Aqua’s Start. Tesco may offer a sizeable starting limit, but their cap is hidden as subject to status.

Limits (Existing Customers): Aquis, Chrome, Granite, Vanquis and XYLO

The top returning limit on these cards issued by Vanquis is £4000. Aquis and Chrome start at £250, whilst the other 2 start lower at £150. Every other card they issue is £150 to £1000 with £3500 on the return. All of Capital’s products have matched sums of £200 to £1500. Aqua/Marbles plus Tesco are subject to status on their return limits.

Membership Base: Capital One

With 4m people accepted and 3m active users, Capital’s subprime customer base is the highest. Vanquis have accepted 3m and they have 1.4m active. Barclaycard has the largest overall tally at 10.5m (UK) and 36m (global). The bulk of their business however takes place on the prime side through their Platinum line.

Payment Networks Used:

MasterCard: Aqua/Marbles, Capital One, Tesco
Visa: Barclaycard, Vanquis

Processing (Best Customer Support): Tesco

Tesco’s support team operates 24/7/365. Barclaycard’s advisors can be reached 7 days a week for application queries between 8am and 11pm. Ongoing support is provided 24/7. Aqua/Marbles are reachable 7/7 for both new applicants and existing customers. The obvious benefit aside from being able to pose questions daily is that your welcome pack should be prepared quicker.

Processing (Quickest Waiting Periods): Barclaycard

Most providers do offer instant decisions, but the actual time between approval and receiving your card typically takes 2 weeks. Barclaycard’s waiting time is however just 5 working days. Capital’s delay is also notable from 7 to 10 working days.

Considerations:

The 2 main lenders (Capital/Vanquis) issue a range of bad credit cards. Just remember that you’ll only be able to gain approval with just one of these. The affinity lender actually does much more than just issuing the funds. They for instance provide the customer support and the account login facilities (in most cases mobile apps are also available). An important point to raise on pricing is that the promoted rates are always best case scenarios. We have illustrated variable APRs today where you can see huge price hikes when scored down. This is evident with the main Vanquis card that is variable between 39.94% and 69.94%. This carries a whopping 30% variation.

We’d advise avoiding cash withdrawals that take on 3% charges. It is worth noting that gambling transactions are also considered as being cash advances. Late fees and returned payment fees come in at £12 and you’ll often see charges between £3 and £5 when you require copies of statements. Using a card sparingly is the best approach, always paying up on time. In managing your money well this will enable you to rebuild trust. This pathway opens the door to competitive rates and perhaps in time even market leading deals from leading banks. Savvy shoppers in this position pay zero interest by moving around to new providers once 0% introductory periods close.

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